PLDT Inc. on Thursday reduced its capital spending by at least 25 percent this year, mostly because of the implementation of the enhanced community quarantine in Luzon that affected its network rollout.
The country’s largest telco said its capital expenditure for 2020 of P83 billion would probably be pared anywhere between 20 percent and 25 percent, suggesting the capex levels will be in the P60-plus billion level.
The company’s network roll out activities have been constrained by the reduced mobility of its network teams since the ECQ was imposed.
The government implemented ECQ on March 15 and extended it until May 15 this year to contain the spread of COVID-19 in the country.
PLDT also said its network rollout for the balance of 2020 would prioritize projects that support the changing demand profile of customers, and help corporates revive their business under these new conditions.
The company reported a drop in net income to P5.9 billion, 12 percent lower than the previous year, after taking into account the equity share in the results of Voyager Innovations and revaluation losses in Rocket Internet.
PLDT raised service revenues by 9 percent to a new high of P41.5 billion in the first quarter of 2020.
The increase was driven by data and broadband services, particularly on its wireless network, which now account for 71 percent of total revenues.
However, the outlook for the balance of 2020 has been affected by the COVID-19 pandemic and the ECQ implemented on Luzon and later extended to other parts of the country starting the second half of March 2020 until the middle of May.
“Moving forward, there will be likely some softening of revenue growth in the second quarter this year. But overall, we expect revenues to stay on the growth path versus last year,” said Manuel Pangilinan, chairman, president and chief executive of PLDT said.
“Moreover, by focusing on helping companies, communities, families and individuals find the digital solutions that put them back on-track to prosperity, we will ensure that our services are maintained at a superior level across all sectors. This is the most sustainable way for PLDT to build a future in this New Normal,” he added.
PLDT’s telco core income was down 5 percent to P6.87 billion in the first quarter of the year from P7.20 billion last year.
“The solid performance of our major business groups in 2019 flowing smoothly into the first quarter of 2020 provides us the firm footing needed to face the tough trials created by the pandemic in 2020 and beyond,” said Smart president and chief executive and PLDT chief revenue officer Alfredo Panlilio.
“This early, we already see how the network infrastructure, expertise and technical resources that we have acquired, upgraded, and made more resilient over the past several years are playing a major role in helping our customers rebuild their lives, and the country regain its prosperity,” he added.